Acer's chief takes pay cut as Taiwan warns of recession
Widens forecast of loss in 1998
Stan Shih, CEO of Acer, has taken his first steps to restore the ailing semiconductor division of the company by cutting his own salary by 30 per cent. Separately, the Taiwanese government issued a warning that the country was in danger of entering a recession. Shih expects other executives and staff at Acer Semicon to take pay cuts of between five and 30 per cent. The company found itself in trouble after it acquired the Texas Instrument part of its joint venture, while the price of DRAM and oversupply in that market put a further squeeze on Acer. Earlier this month, Shih said he was restructuring the entire Acer group so that he could concentrate on turning round the Semicon division. Acer is not the only Taiwanese company in some difficulties as a result of the general Asian malaise. The Taiwanese Council for Economic Planning and Development said that the island was in danger of entering recession. Exports in the first seven months of 1998 showed negative growth of eight per cent. Exports from the IT sector in Taiwan represents the biggest chunk in money terms. Earlier this week, Acer warned that it would make a bigger net loss for 1998 than it had expected. It will go into the red to the tune of NT$ 4.9 billion, while sales will drop by $NT7 billion from its previous estimate. ®
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